During this year’s GridWeek conference in Washington, DC, I picked up a line that I think nicely summarizes today’s electric grid situation:

If Alexander Graham Bell, inventor of the telephone, were to come back today, he would not recognize the modern day communication system with digital-based Internet and wireless networks with their cell phones, Web 2.0, YouTube, and Twitter. On the other hand, if Thomas Edison, one of the electric grid’s earliest architects, were to return, he would readily recognize our electrical transmission and distribution scheme, because many of the grid’s components are fundamentally the same as they were in his day.

Some 120 years after Edison had fired up the world’s first electric utility, Pearl Street, in Manhattan, industrialized countries as well as emerging economies are thinking hard about how to revitalize their electricity networks. The motives behind this action are manifold: aging or non-existent infrastructure, renewable energy policies driven by climate concerns, or socio-economic and security considerations. The Smart Grid seems to offer the solution to all those challenges, seemingly a kind of silver bullet. However, given that the current electrical grid has been described as the most complex machine ever built, and named the greatest engineering achievement of the 20th century by the National Academy of Engineering, one can easily imagine that transforming the current grid into a smart grid is quite a complex task.

In his article, Peter Fox-Penner, former Brattle Group chairman and seasoned expert in the electric utility business, addresses the challenges facing American energy utilities and suggests to the industry a new – smart grid-enabled – business model of energy services that would actually make them sustainable by selling less.